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Mad Money

News/Business. (2012) New.

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480

TOPIC FREQUENCY

Kroger 15, Jim 10, Washington 5, Kraemer 4, Us 4, Florida 4, Billy Joel 3, Jim Kraemer 3, Teleco 2, Illinois 2, Unitedhealthcare 2, Safeway 2, Costco 2, New Hampshire 2, Kkr 2, Whirlpool 2, Armon 1, Krog 1, Detreated 1, Brent 1,
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  CNBC    Mad Money    News/Business.  (2012) New.  

    November 28, 2012
    6:00 - 7:00pm EST  

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>> does anybody have a power ball ticket? >> yes. >> oh, really? i better get one. >> some of us would like extra money, melissa. >> i'm melissa lee, thanks for watching, see you
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we may very well go over the fiscal cliff come january and i want to be ready to climb back out with the right stock after it happens. you can't come from a given day like today, dow 107 points, hey, happy days are here again, right? this is a day where my equipment felt a little -- felt a little superfluous because we had all sorts of happy talk for a bunch of people in washington about how compromise was within reach. however, i think it's been increasingly apparent that we actually may not get a deal in time of the january deadline, something warren buffett pointed out. you don't need to change your philosophy just because we
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cliffed you. long term it might not matter. not all of you share his sangwin multi-year view of stocks. he can afford to take the long view. if we take the plunge over the cliff, it can cost everyone $2 million, makes everyone pay more in taxes. i don't really want to have this gear. the president said today he thought a deal could be done by christmas. the speaker of the house said he's optimistic a compromise could be reached. i wear this pin every night in in part because i genuinely believe it is not a lost cause. tonight business leaders in washington are urging a deal. people who are not really known as pals of the president. the president also bringing his pressure to bear on small regular people, regular folks.
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i'm old enough to remember when it meant my parents. he's turned to twitter to talk about the evil kwonss of cliff jumping. let me tell you, why all this talk may end up being nothing but big hat and no cattle. what we're seeing now is something which was supposed to be totally draconian, increases in old tax rates, coupled with automatic cuts in spending may not be unpalatable to change the minds of intransit politician. that's because right now that the very moment many of those politicians believe rising above politics is political suicide, that compromises the real and dreaded enemy and that this pin right here, this rise above, this is the very devil when it comes to their career. you know, what i get this. come on, i'm cynical, i get it. if you believe an entitlement should never, ever be cut and
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should be expanded upon, you might favor sending us over the cliff on principle. if you believe that taxes should never be raised, you might be tempted to send us over the cliff on principle. if you believe your house is going to be jeopardized -- you know what they say above you? they say oo orhypocrite. let's go one step further. potential loss of jobs, higher mandated taxes, defense budget, small price to pay for standing on principle approximately it's a betrayal for a huge number of these people. if you're a republican, hell bent on never raising taxes, go over the cliff and then give into the president but you can also say you cut taxes. remember that? it's a win-win to go over the clip. then you don't break the grover
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norquist pledge to raise taxes. which is why it's time to prepare for the failure of december talks. maybe we need the hardships main street middle class to become so clear that a compromise that abandons cherished principles may be the only way to avoid a recession, which would give other candidates a chance to rise up and take your seat in congress. hence why i'm not back with the 10% solution, a solution like how the dreaded tarp got through congress, so-called bank bailout. 10% after tarp was first rejected and congress people, constituents who own stock, people who can afford to contribute to campaigns, we better do some compromising. that could happen again if we don't get a deal by year end. it comes down to the final weeks of the year when it's clear we don't have a deal, some will sell their stock economically might save a ton taxes versus
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the 2013 tax code. the jobless claims that come out at 8:30, right now they aren't going up much because they aren't seeing lots of firings and they aren't going down because business is frozen by the fiscal cliff. if you think about creating a business, if you sell it, you want a good capital gains rate. you might have to start firing in january. i think if we miss this deadline the market will get pounded every thursday as claims spike because of mandated layoff where reports are right that a million people will lose their jobs in 2013. also we failed to rise above. and when that happens, believe me, you'll want every bit of this mountain gear. you'll want this -- we got use this. this will no longer just be a key chain, all right? because if we're going to climb out of the cliff, i need you to
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be the first there, i need you to be the first to the best stocks. so which are they? i envision all segments getting pummelled but the ones that bounce back first will be the ones that are sold down the worst. to me that manse i want to climb out of clift using a stock like home depot. yeah, man, i'm going to climb out there and get this. home depot. that's one i'm going to get. because it's up 54% for the year. the most visible winner in the dow jones industrial average. you may have to buy that stock as early as the first week of january. whirlpool down more than 116% this year. i think the housing boom will not be hurt from reality nearly as much as it might be in theory. at the same time if the 2013 tax
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code more than doubles the taxes on dividends. i want to be there with my ropes, make them so i can secure myself and get them right back in. here's the bottom line. i don't want it to go over the fiscal. i'm a 46 in the adirondacks. the losses on the cliff won't impact the legislators until after the market climbs and unemployment skyrockets. it will be cause -- the cliff is going to close soon and you'll be up there with your home depot, sherwin-williams and at&t. why not be profitable on the other side of the valley. let's go to robbie in michigan,
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please. >> caller: with the 27% increase today, should i take my money and run? >> i don't know if it's going to be a 40. walt in new hampshire. how do youing? >> caller: boo ya from concord, new hampshire. >> "the monitor" me a job in 1977 and i almost took it.
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>> whirlpool, should i hang on? >> even though it's up 116%, it should not be sold. i owned it in the 50s in my law school dorm in 1983. let's hold on to this and go to patrick in washington. >> caller: hi, jim. booya. given the recent divergence between the price of gold and gold mining stocks with the price of gold going up and mining stocks being level or going down would it be wise to hang on to my investments in the gold mining stocks in hopes that they catch up with the price of gold or should i just sell them off and put the money into gld or something like that? >> i think you should sell them off overtime and put your money in the gld. today was a temporary setback because of all the happy talk in washington. pat in illinois. pat. >> hey, jim. pat from chicago. how are you? >> not bad. how about you? >> caller: i'm doing well, thank
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you. jim, got a question for you. corning, i've owned it for 14 1/2 years, been accumulating it for those 14 1/2 years and it's been a dog from the day i bought it. it's hot one day. ceo said that the tv glass manufacturers are buying their glass like crazy. >> yeah. >> jim, should i sell it? >> no, don't sell it now. think about that, 14 1/2 years, wow. it wasn't 14 1/2 years, it did run from 1998 to 2000. i think your judgment is off by two and a half years. but it has been a real battle. let'slet it go lele lele lelet then get rid of it. hold on! we have to get ready with the climbing equipment to be the first people out of the cliff. wow. am i ever ready for this baby.
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"mad money" will be right back. coming up, location, location, location. one software stock has been surging over 15% in the past month while the market's been flat. could it still be positioned to profit or did you miss the move? kraemer's navigating to the facts to find out next. >> and later, grocery conflict? it's an all out race for supermarket supremacy. get ready to go shopping just ahead. all coming up on "mad money." >> don't miss a second of "mad money." follow on jim kraemer on twitter. or give us a call at
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1-800-743-cnbc. miss certainly in head to "mad money.cnbc.com. having you ship my gifts couldn't be easier. well, having a ton of locations doesn't hurt. and a santa to boot! [ chuckles ] right, baby. oh, sir. that is a customer. oh...sorry about that. [ male announcer ] break from the holiday stress. fedex office.
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every now and then a stock will do certainly that makes you scratch your head, wondering what the heck is going on! whenever we see one of these difficult-to-fathom moves, it's my job is to explain to you why it's happening. consider the incredible transformation of trimble, trmb navigation, a global positioning company that had been lost for dead. yet today it is less than a point off its high. in fact, the stock's up 18% just in the last 30 days! and a phenomenal 38% in the last 12 months. how did garmin make such an incredible lazarus-like return from the dead?
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a couple different elements here. even though people think of it as just a global positioning play, that is not longer the case. from the back office to the field office and then from one field site to another. then they moved into the business of modelling, building a number of modelling applicationing and then they started doing analytics using data they collect to help businesses make better business decisions. in short trimble is a commercial global positioning company that got smart and this business has become a terrific secular growth story. and the underlying economy ain't doing so hot. this new trimble is all about helping customers become more productive and more efficient, antidote for this low growth economic environment. it uses proprietary technology,
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collect data from other measurement technologies and it processes that data that's designed to tell the customers what's needed to improve efficiency of workers out in the field. especially at construction sites and new infrastructure builds. those software builds can cut fuel costs or improve customers service or safety standards. it all comes down to helping other companies to find new ways to squeeze more money out businesses. that's the kind of pitch that never goes out of style. certainly not one that the old trimble could have offered. it's a joint venture with cat pilller where their technology will be sold to cat dealerships for everything to machine control technologies. this gives the company a tremendous outsource international sales force. it looks like it's become the
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real deal. companies had a conference for the users of the systems. this wasn't a gigantic who la gigantic shindigs, they set a record for attendance. we're not just counting bodies. the reason so many people showed up is because they offer such a tremendous value acquisition. the average payback period for customers, less than a year. the services will likely pay for themselves in less than 12 months. no one der the stock is within distance of its 5 -week high. the company has been executing fabulously in this currently lousy environment. the latest quarter incredibly strong. better than expected revenues. how many of those have you had? bye, b buy, buy, buy! they get half of their revenue from overseas.
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european exposure. but it doesn't seem to be hurting. vast majority is coming from organic growth. those are terrific numbers. but i don't believe that they're pie in the sky numbers by any means. when you have something like that, you're going to be able to take market share left and right or raise prices dramatically. either way it means you can crush the estimates. a number of the analyst who cover trimble think that the company's technology is necessary for the company's survival. plus during early innings, trimble's office equipment is very unpenetrated. remember sales force.com just had good numbers in europe because they're finally getting to penetrate. there's a lot of room to expand. trimble is growing at an incredibly rapid case. at some point once they get a
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big enough installed base, tre-the-can do upgrades with new software roll outs and hardware, although that could take quite a while to have it. one more reason why trimble can go even higher. you know what? i wasn't thinking when i was looking at these guys. i said, geez, i can't believe ibm, oracle hasn't snapped them up. if the stock kind of sits here, it will happen. i think takeover talks have been driving the last leg of this stock because it's been so miraculous. >> this isn't a what the heck? this company is no longerer a has-been company. it's because a data automation power house! and i think the trimble rally is far from over. after the break i'll try to make you even more money. >> coming up, gross riff
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gauntlet? it's an all out bout for supermarket supremacy and tonight kraemer thinks one of these stocks belongs in your cart, while the other could be spoiled. get ready to go shopping, just ahead. music is a universal language. but when i was in an accident... i was worried the health care system spoke a language all its own with unitedhealthcare, i got help that fit my life. information on my phone. connection to doctors who get where i'm from. and tools to estimate what my care may cost.
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so i never missed a beat. we're more than 78,000 people looking out for more than 70 million americans. that's health in numbers. unitedhealthcare. sven gets great rewards for his small business! how does this thing work? oh, i like it! [ garth ] sven's small business earns 2% cash back on every purchase, every day! woo-hoo!!! so that's ten security gators, right? put them on my spark card! why settle for less? testing hot tar... great businesses deserve great rewards! [ male announcer ] the spark business card from capital one. choose unlimited rewards with 2% cash back or double miles on every purchase, every day! what's in your wallet? here's your invoice.
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you know there are groups of stocks that i absolutely loath.
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no matter what the circumstances. the airlines are one and the supermarkets are another. with the sole exception of whole foods, which is practically in another category all by itself are given that it's the place where people go to buy expensive food that has the company's natural and organic seal of approval. but the regular supermarkets have been the definitive house of pain. they have razor thin margins, facing cut throw competition. but from other big box stores leek watt mart and costco and cvs and the dollar stores, it's just a tough, miserable business. however, even in an incredibly difficult sect, you get some true differentiation. some stocks execute better than others. the one company that has managed
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to buck the negative tren has been kroger. safeway has been hammered, down 19%, kroger has managed to keep its head above the water and up 3% on the year. not a particularly big return but relative to the circumstances, kroger has been supremeio. what's the secret here to kroger's success? the company reports tomorrow morning. so we did this in preparation of that. i think we're going to get cloous that can tell us what's happening here in so you find out if you want to buy it when the numbers come out. by why raent troger been crushed if the rest of them have? this is not a company like whole foods with a high-end brand.
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last night we got insight into why it's been kroger may have been able to avoid slipping into the valley of shadow and death. last night we talked to gary rock ceo of con-agra and we were talking about its acquisition for the king of private label foods, especially syrup, meaning the knock-off generic products that sell for less than the nationally branded stuff. he noted that the kpli right now is currently very bifurcated. it's where people no matter what economic straightia they might be in are trying to save on the basics. people are trying to figure out how they can get the most fo their money. the biggest step in that direction -- the reason con-ing
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a ra wanted to buy roll korp explains why kroger has been able to outperformthe europe markets. they're doing by managing pricing. so how much better has kroger's execution been? consider these numbers. kroger has been the only traditional grocery store rate operator to consistently generate returns above its cost of capital. back in october the company raised its long-term earnings growth forecast while superstore -- safeway down 101%. now, kroger actually posted an impressive 3.6% increase. kroger's margins have been detreated. over the last couple of months, the company has been arrives 300
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to 500 -- again, krog ser not in the same weight class as the holds -- within the troubled supermarket business, this company is in a league of its own. how much has kroger been able to do so much better? a lot of it comes down to their ability to control pricing. about a decade ago, controller made an aggressive position to -- why that i loath of supermarket stocks. in order to retain customers and mark market share. kroger acted and fast. for the first time they've become more comfortable with their competitive decision and feels less urgency to cut crisis. kroger kroger is the second
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largest player in groceries. they're also opening more new stores because they can afford to. safe way but they don't have the balance sheet to start expanding aggressively. hey, let's open some more bad stoor by practicing thursday, you lood kroger has the highest
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private label penetration in the group at about 27% of the merchandise. small step up in safeway, 25%, big step up in supervalues. more than that, kroger profr dueses more than 40% of its own private label products and so therefore they make a ton of money on kroger itself. >> now, it's too late to buy kroger ahead of the quarter unless you do it after hours. last time woo this i bet that story continues when we see their quarter result. just look at growinger versus safeway. wheel he's been able to hef sear. you can transstend even a lousy history if the people inside are making the right clothes.
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>> let's go to joey. >> caller: booia, jim. >> caller: the majority the -- make up the profits -- i'd rather -- -- i need to go to armon in connecticut, please. armon. >> hey, jim what's going on? >> not much. >> want to look at the fresh mark. stock hammered. i was wondering if -- what do we got to be in the second best? i mean, it's we have unbelievable players who run whole foods.
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the woe to play. >> caller: jim, boo yah, to you in. >> caller: i was watching your show yesterday about private lald goods. could private label grou as your car came o me did or as we have, he could tell you where they really crush kimberly, not and psh. >> it's kroger, not safeway and super value. >> that's all in the same
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business. kroger's looking good. stay away from the other guys. don't move, lightning round is next. [ male announcer ] this december, remember -- you can stay in and share something... ♪ ♪ ...or you can get out there with your friends and actually share something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this is the pursuit of perfection. ♪
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welcome to the world leader in derivatives. welcome to superderivatives.
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it is time, it is time for the lightning round! what's that all about? i tell you to sell, i tell you to buy, buy, buy. and then the lightning round is over. are you ready skeedaddy. jeff in virginia. jeff! >> caller: my stock is hillenbrand. >> i do not have a fresh take on it. i promise to do my homework on it. let go to brent in alaska. how are you? >> caller: fiene. >> it's kraemer. do you have a stock?
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>> caller: clne, it's not doing well. >> no major representative in washington seems to want to do anything as having natural gas a regular fuel for service vehicles. therefore it's just a speculation. john in florida. >> caller: jim, big boo ya to you from lake ashland, florida. >> man are you lucky throb. it's so miserable here. what's up? >> caller: baidu. >> no, no, i can't own individual. a loss there represents a value. john in florida. >> caller: hi, jim. i just want to mention i don't know if anyone ever told you but you remember billy joel, not lennon like you showed that portrait last week. >> billy joel was quite a hero in the concert for sandy. he looked great and he sounded great. >> if i don't like billy joel,
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i'm done. >> caller: what's your upon on plcn, pollycon? >> we don't want to be in anything i regard as video and voice because you'll be competing against the giant that is cisco! >> glen in illinois, please. again? >> caller: i'd like to thank you on your excellent insight into jobs in general. >> my stock has been up at past eight trading days and i was wondering if this was any case the stocks stocks were to pop. cldx is the prop. don't know why it's up. got to come back. sorry. could be a could good peck.
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>> all my florida calls are so -- what do you got? >> bye, bye, bye. >> he who is -- stephanie lake, we were talking, i said this is right now, one of my absolute favorite stocks between now and when this deal closes, underrated, so smart, it will do 14, what he has done for coffee! let's go to john in colorado. >> hi, jim. i'd like to give a big boo from a. >> we got another call about one of these dals. they have not been aking that
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rally has the sbrk. >> it had a full back to 52. i had it down to about 48 and. and that, ladies and gentlemen, is the conclusion of the "lightning round." [ male announcer ] this is steve. he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks,
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or jumping into the market, he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. scuba diving into the bsh which is rewoo doesn't po other things, no matter what happens. which isn't rocket science. it just comensense. from it. >> b. spsh duluth trading butt naked everywhere feels like. go up there at delay tlading.com.
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-- trading.com.
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this market, chaotic place. i doubt things will change much over the next few weeks. now is the time to prepare for
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the worst. hope for the best but prepare for the worse. it's likely mark workt be go rue tlun the twruchbld or you tweet me at snornlt. >> why don't we start with@henry dll pill ar prp skb zbrrmt swrr
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wind stream, i'm worried about the yield there. a lot of bad nut in the last few days. there as a 00 that are better, and then park. >> spchl. >> caller: mald boo-yaks fk this was. >> at at utility call sale spachl snchl at the.
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>> all right, teleco, teleco, we're going to iks. spc spchl. >> hallelujah! >> why don't we go to kurt in. >>. in my boggs prele. from sfwhchlt eatsies nichlt i i
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have i versified. >> okay. we think the world of howard schultz and the team who took on a position like this. westport exorganization boy, technology. play cry pluck gay for good maps. easy play and energy play. down delayed i think usually for. a restaurant, let call it that. a disji play. . and now we need to go to donna in texas. done a! >> caller: good been u snumt of
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of mulk ulgd nasz grol, oofr you governor ksz kolt. >> >> caller: good evening. western union? >> western union we're going to transfer. it's been going up, it's a bank. aig, they're very different. kkr is a private equity company. we're going to get rid of bank of america, we'll can keep kkr, you're leaving western union
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entirely and let's add apple, too, because you don't have enough technology. that, ladies and gentlemen, is the conclusion of diversify! back after the break. >> it's a brutal full-contact sport. >> from the time the whistle blows, traders bracing for what could turn out to be a wild session. >> it's the last play of the game. >> the market is absolutely getting hammered today. >> i know it's not easy but i promise to keep fighting for you. >> jim kraemer, leveling the playing field for all. >> the road is a tough one but the playoff can be the greatest one of all. >> join "training camp" week nights.
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i've been a superintendent for 30 some years at many different park service units across the united states. the only time i've ever had a break is when i was on maternity leave. i have retired from doing this one thing that i loved. now, i'm going to be able to have the time to explore something different. it's like another chapter.
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some decisions, some transaction says more about the u.s. economy than all the other reports out there, labor, commerce, i don't care. maybe more than all of them combined. the move by conagra is one of those decision. a lot of different household brands cobbled together, both the supermarkets and restaurants, mcdonald's, that kind of thing, slim jim, marie, hunt, chef boy-r-dee. many of them lost their cache, because manufacturers have taken prices up year after year after
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year. why? to please their stockholders. it's not good business. combination, the analysts jacking up the prices, smaller profit margins for the stores that sell them has led to a situation where they feel pinched, you feel pinched. enter private label. the supermarkets tried to adopt the equivalent of what's known as the pipe and rack outlet store. the deal was to say look at me, look at me, i'm cheaper than the other stuff. buy me. you took it to the register, i'm struggling to feed my family. when you took it home, your family says this doesn't taste as good as the brands. but on the way we got the evolution. the company announced a fabulous $7 dividend today, is no longer
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questioned as being inferior to the name product. i'm sure that judging by how few people bought higher prices, costco's kirkland may be considered superior to the brand named products. the gross margins for labels are gigantic. then came the recognition if the store bought product just looked more like the level promoted product, it would become more popular given its final price tag. here, now, what now, supermarkets try to outdo the branded packages and prices. when you get to the checkout counter, you now look smarter than the other guy when you had the private label and very few believe there's a compromise in terms of quality. i myself am a huge private label buyer. given a world where value buying is now considered a necessity
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for many and clever by everyone else, having a private brand is a way to grow your business. conagra addresses the world head on. you can't be knocked off easily. am i going to buy that other kind of pam? and your superior quality label in places because the gulf in this country between rich and poor demand it is for survival sake. so conning a gra buys world korp. the trend is too powerful. maybe it's a tail of who cities and maybe both sties are play. >> you capitalize on it or you just eventual li fade away.
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stick with kraemer. >> follow spaz@jim kraemer --. next on cnbc, "the kudlow report."
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first